It’s the Bank’s job to be right, not popular

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You can see why Sir Mervyn King might want to avoid a headline that read “Bank
of England chief kicks hard-working families off housing ladder”.

If the Bank’s new Financial Policy Committee (FPC) was given the power to ban
riskier mortgages to deflate a housing bubble that is just the sort of
coverage it could expect. And it doesn’t like the idea. Which, frankly, is a
bit wet. The Bank is happy to be given huge powers to supervise the banks
and safeguard financial stability. But it doesn’t want to upset anyone by
using them.